Friday, June 16, 2017

MONEY-SAVING PROP. 103 BEATS BACK ANOTHER CHALLENGE

The 1988 Proposition 103 has saved
California consumers more than $100 billion in excessive auto insurance
premiums since voters passed it by a slim 51-49 percent margin, probably the
reason for an unrelenting legal onslaught by the insurance industry.

No one has
calculated the accompanying savings in prices for homeowners insurance and
other property coverage, but they’ve also been substantial.

The brainchild of longtime consumer
advocate Ralph Nader and his onetime California protégé Harvey Rosenfield,
Prop. 103 is the rare initiative that keeps living up to its original promise –
saving consumers and businesses about 20 percent of what they would otherwise
spend on car insurance and property coverage.

It consistently makes reality of the
pledge that spurred insurance companies to spend $63 million trying to beat it
at the polls.

The latest corporate challenge to this most money-saving of
all ballot

initiatives ever passed
anywhere in America was beaten back the other day

by Rosenfield and a
three-judge panel of Sacramento’s Third District state

Court of Appeals and the
state Supreme Court.

In this latest case, the state’s high court let stand a
Court of Appeals

So laughable did judges find the industry arguments for
their putative

price increases that the
three-judge appeals court panel considering the case called it “hocus pocus”
and “smoke and mirrors – nothing more.” The companies sought about $250 million
more than Jones allowed. His authority to oversee such rate increases also
comes entirely from Proposition 103.

“This latest challenge to 103 came after the state Supreme
Court two

other times upheld 103 and
its rules for rate approvals,” said Rosenfield,

who continues to fight the
challenges every time they arise. The

decisions, he noted, were
unanimous, some issued at times when Republicans held the court majority.

But the industry never seems to give up
its thus-far forlorn hope of going back to the higher-premium days before
passage of 103. Before then, too, insurance commissioners were appointed by the
governor, not elected.

The latest case actually began in 2009, when Mercury
Casualty tried

to raise rates by 8 percent.
That increase would have included

compensation to the company
for both non-insurance related advertising

expenses and reimbursement
for almost $1 million in political contributions

and lobbying expenses. These
are categories regulated companies

almost always must pay from
their profits.

Instead of getting an increase, the case resulted in Jones
imposing a

5.4 percent decrease in
Mercury homeowner’s rates. Furious, Mercury

sued in a Sacramento County
court, arguing it should be allowed to charge

whatever its executives say
it needs. The firm claimed 103 deprives it both

of the right to free speech and the right to
make whatever profit it deems

fair.

So far, those contentions have not flown in any court. But
even as the

state’s high court was
dismissing those claims for at least the third time,

Mercury’s allies in the
Association of California Insurance Companies and

three other industry groups
were filing a similar case in San Diego.

Mercury also seeks in an Orange County case to avoid a $27

million fine for
overcharging customers.

“The insurance industry is inundating the courts with a
continuous

barrage of frivolous
lawsuits,” said Rosenfield. “They’re trying to win from

the courts what they lost at
the ballot box almost 30 years ago.”

He added that “Prop. 103 was a populist revolt that worked.
It has

delivered much more money
back to people than anyone could have

predicted back in 1988.”

Along with the 1978 Prop. 13 and its limits on property tax

increases, Prop. 103 is a
strong factor making California affordable when

its income, sales and
business taxes are among the nation’s highest.

That’s why preserving this
law against insurance company attacks is vital to the lifestyles of millions of
people in this state, even if many of them have never heard of it.

-30-
Elias is author of the current book “The Burzynski Breakthrough: The Most
Promising Cancer Treatment and the Government's Campaign to Squelch It,” now
available in an updated third edition. His email address is tdelias@aol.com

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About Me

Thomas Elias writes the syndicated California Focus column, appearing twice weekly in 88 newspapers around California, with circulation over 2.2 million.
He has won numerous awards from organizations like the National Headliners Club, the California Newspaper Publishers Association, the Los Angeles Press Club, and the California Taxpayers Association. He has been nominated three times for the Pulitzer Prize in distinguished commentary.
Elias is the author of two books, "The Burzynski Breakthrough: The Most Promising Cancer Treatment and the Government's Campaign to Squelch It" (now in its third edition; also published in Japanese and recently optioned for a television movie) and "The Simpson Trial in Black and White," co-authored with the late Dennis Schatzman.